Why Aren’t More Dealers Capitalizing on Trade-In Leads?
Tailor your website’s trade-in strategy to keep customers on a path into your showroom
Over the past few years, trade-in leads have become increasingly valuable conversion opportunities, but most dealership websites are not optimizing them. Before we go any further, let’s start with a little history lesson.
About 15 years ago, consumers used static forms to request additional information. Obviously, this doesn’t work as well now as it did back in the day because those forms were quickly eclipsed by calculators that could instantly spit out an estimated appraisal based on specific vehicle information.
With the introduction of third-party trade-in calculators like Black Book, NADA, and Kelley Blue Book, dealerships began to see tons of new leads coming in. Initially, the idea was that consumers wouldn’t have to leave your website in order to get a reliable estimate on their trade-in. Additionally, you received the benefit of being associated with a trusted third-party brand.
Now, the average consumer gets multiple trade-in value estimates from a much larger number of third-party tools before they even consider visiting your website. What this means is consumers are coming to your site after appraising their trade elsewhere.
So, what does your website’s trade-in strategy need to do to keep customers on a path into your showroom? How do you ensure that the trade-in process on your website offers an experience that these consumers trust, while also keeping your brand front of mind?
A new approach
Today’s website visitors are overwhelmed with options. Car buyers are begging for something to stand out that gives them a reason to buy.
For many consumers, getting a trade appraisal is where they start their online research. The online trade-in process can provide some of the most powerful leads your dealership can generate. Our research shows that more than 50% of trade leads are ready to buy now or within two weeks.
Many studies on automotive consumer behavior reveal researching trade value to be the top reason consumers visit a dealership’s website. More importantly, it offers a hard incentive for them to make an appointment to come into the dealership.
First-party or dealer-branded
Because your website visitors have probably used third-party trade-in tools on other websites, they already have an idea of the market value of their vehicle. But when they come to your site, they are likely closer to purchasing, and more ready to get serious about their trade-in.
At this point, your dealership logo needs to be front and center as consumers makes their way to purchase. This doesn’t mean, however, that third-party logos should be completely off the table; some of these brands are well-known and offer significant credibility to consumers when valuing their vehicles. All you need to do is minimize the third-party logo to a “powered by”–type position.
Use this opportunity to convey your “why buy” message and make customers feel comfortable with your brand. They need proper validation that you’re going to be within the range of value that they’ve already researched.
Optimize for conversion, not appraisal
Collecting consumer information during this process will be a huge benefit when you develop an informed relationship with your customer. But what information should you be collecting?
Historically, most website trade-in tools involve collecting detailed vehicle information. Generally, 80% of the information collected is about the vehicle, and 20% is consumer contact data.
Most dealers would agree the average consumer isn’t experienced enough at appraising vehicles to properly enter the correct information. No matter how good the data source or appraisal tool is, it is restricted by the information entered.
Another challenge in offering online appraisals is that consumers might interpret that number as a cashable offer, and you want to avoid having to backpedal on that number. A “transparency” approach that gives a range of values signals to customers that you’re going to be reasonable about their trade-in, and will also offer you flexibility during the process.
Because you’ll want to focus on conversions and sales, change your focus to information that will help you convert, versus overly detailed appraisal information. Restrict to asking only about the major vehicle information, and focus your efforts on collecting useful information about the consumer for proper follow-up.
An ideal consumer profile should be broken down this way:
- 20% vehicle information;
- 40% basic consumer info (name, number, purchase time frame, and contact preference); and
- 40% expanded consumer info (additional questions that help personalize consumer profile).
The equation is simple: With nearly 80% of consumers likely to purchase within a month, trade-in customers are serious purchase customers. Adjusting your trade-in strategy and tools to meet today’s consumer is a “trade” off that will pay off in sales.
With more than a decade of experience in the auto industry as a dealer, Russ Chandler has seen firsthand the problems dealerships face everyday. As a product marketing manager for PERQ, Russ combines his expertise with powerful technology, such as FATWIN Web Engagement, to provide his clients with increased response and conversion on their marketing.